Intellectual property law is good. Excess in intellectual property law is not. This blog is about excess in Canadian and international copyright law, trademarks law and patent law. I practice IP law with Macera & Jarzyna, LLP in Ottawa, Canada. I've also been in government and academe. My views are purely personal and don't necessarily reflect those of my firm or any of its clients. Nothing on this blog should be taken as legal advice.

Thursday, December 27, 2007

Warner has now dumped DRM and made its entire catalog available DRM free on Amazon. Smart move, Edgar. See the very cutting edge Red Herring report:

"Give it four more days and we can finally say that 'DRM is so 2007,'" said Michael Goodman, an analyst with Yankee Group. "Music history will document the transformation from DRMed music to DRM-free music as occurring in 2007. I can't imagine anybody doing a DRM deal in 2008."

The article goes on to state:

The deal further marks the death knell for digital rights management, or DRM, a controversial technology that restricts the usage of music purchased online. New York City-based WMG and Sony BMG were the last two of the Big Four labels to hold out on DRM-free downloads.

So - that leaves only SONY BMG (who brought us the "rootkit" DRM disaster) as the last of the big four holdouts so doggedly represented by the RIAA and the CRIA.

And it suggests yet again the necessity of asking why any government would now consider providing protection for DRM, rather than from it. Maybe the best thing now would be strike a Canadian balance and just forget it. DRM's time as a legislative issue appears to have already come and gone.

He points out that Australia now has a 645 page - yes 645 page - long Copyright Act, as a direct result of American pressure to ratify the WIPO treaties in the DMCA mode.

I would point out that Australia, which is home to several brilliant copyright scholars, is, however, possibly the worst example Canada could look at with respect to the results of recent American lobbying influence. Note the recent de-election of John Howard's party and Mr. Howard personally as well. This was not likely over copyright but apparently very likely over Mr. Howard's pro-Bush/war in Iraq stance.

But lest I forget, while a 645 page or so copyright act may do very little good for creators and very much harm for users and consumers, it would certainly be terrific news for lawyers looking for more work.

Here's the Register report, which quotes the colourful lawyer for Antigua, Mark Mendel, who is very dissatisfied with the quantum and method of calculation. He had sought $3.2 billion. And according to this article, it ain't over yet:

Unlike other WTO rulings, awards of arbitrators are not subject to review by the Appellate Body of the WTO. However, were internet gambling to continue to expand in the US - as seems almost certain - Antigua would have the right to return to the WTO to reassess the damage award. Antigua's position will also have to be revisited as the US continues its Article 21 proceedings to withdraw gambling services from its WTO commitments.

Here'sBill Patry's takeon the ironic possibilities of how this amount will translate into action by Antigua. Bill says:

One wonders whose figures Antigua will use to come to that amount: the IIPA's ludicrously inflated figures, where every estimated unauthorized copy represents a 1:1 displacement of a sale at U.S. prices, or something else of Antigua's own concoction? I am betting on the latter.

Another irony is that this is about 21 times more than the US is now paying out for the sweet deal it got for flouting its obligation to pay for public performance in small establishments in the WTO "s. 110" decision.

There's been a lot of buzz lately about the possibility of an official public inquiry, whether in the context of a Royal Commission, Parliamentary Committee or other formal process. Howard Knopf has been making this plea for years, and I think he's bang with his suggestion and the reasons for it. To me, the only real questions are how quickly an inquiry could be organized, and when it ought to take place. Should the inquiry precede a bill or should draft legislation be used as a basis for discussion? Frankly, I think either option would be pretty good, and both are better than the closed-door process that's taken place so far. A public inquiry of any sort at any time could provide a framework for consideration of the grassroots concerns we've seen articulated informally in the past few weeks via facebook and in the mainstream media.

This is the first of several interesting New Year's resolutions that Jeremy will outline over the next few days. Watch for them....

Saturday, December 22, 2007

Ottawa accused of caving in to Hollywood on copyright

BILL CURRY

From Saturday's Globe and Mail

December 22, 2007 at 12:02 AM EST

OTTAWA — The Conservative government hasn't even released its proposed copyright reform legislation, but already a showdown is brewing between media producers demanding protection from tech-savvy pirates and the grassroots efforts of thousands of Canadians who believe the bill will be unjustifiably restrictive.

As a result, what was once a low-key issue in Ottawa is morphing into a potential political storm.

Friday, December 21, 2007

Here's a very constructive press release from the Canadian Library Association, on behalf of its 21,000,000 users and 57,000 library staff. Here's an excerpt of the CLA's letter to the Ministers, which includes some very specific, positive and well reasoned positions:- Any new copyright legislation must be carefully crafted so that it punishes copyright-infringing behaviour but does not ban devices that might be used to circumvent technological prevention measures. "Technological measures can be used to invade privacy and prevent Canadians from invoking their rights," Butcher said.

"The legislation must protect Canadians who are merely upholding their rights."

- The Government needs to recognize that government documents and government data belong to all Canadians and that all Canadians should have liberal access to these materials.

"Current Crown copyright rules can mean Canadians pay multiple times for the same information," Butcher said. "The increased costs are barriers to learning."

- Persons with perceptual disabilities must have the same right to access copyrighted materials as all Canadians have. This right should apply regardless of format in order to accommodate their particular needs. Legislation is required to give persons with perceptual disabilities access equity with others.

"Digital information is extraordinarily useful in overcoming physical, learning and perceptual disabilities," Butcher said. "This is a real opportunity to level the playing field."

- Libraries oppose legislation that makes the same mistakes as the American Digital Millennium Copyright Act. American law makes no differentiation in penalty between a counterfeiter circumventing technical protection measures for illegal profit and an individual circumventing technical protection measures to make a single copy.

"Even one of the architects of the DMCA has admitted it is flawed legislation," said Butcher. "Let's not make the same mistakes."

Who's the Holiday Grinch? I nominate Kraft Canada for trying to deprive Canadian children of chocolate bars.

This month, Kraft Canada sued a small Montreal company, Euro-Excellence, for the second time after having lost its first case last summer before the Supreme Court of Canada. The Competition Bureau needs to stop this abuse.

Euro-Excellence imports Toblerone and Cote d'Or chocolate bars from Europe. It pays full price to Kraft Canada's European parent company, the manufacturer of the bars. Kraft wants to stop the importation of its bars into Canada to keep prices here high. Cote d'Or bars sell for about half the price in France than they do in Canada.

Kraft is also trying to keep the Canadian market starved for chocolate by reducing the flavours it allows into the country, again leading to higher prices from Canadian consumers. At a time when Canadians are already paying too much for imports due to the high Canadian dollar, this smacks of exploitation.

Kraft is relying on a section of Canada's Copyright Act that has nothing to do with chocolate. The section aims at preventing the importation of illicit copies of books, CDs and other creative works into Canada from countries where musicians and authors receive no payment. Kraft says Euro-Excellence is violating Kraft's copyright in its logo when Euro-Excellence imports chocolate bars into Canada.

Kraft lost this case after having dragged Euro-Excellence through the courts for the past five years. Not satisfied with a ruling against it from the nation's highest court, Kraft has started another suit, presumably knowing that Euro-Excellence probably does not have the resources for another fight. This is exactly the kind of misuse of the law that judges say is undermining the public's respect for the justice system.

Kraft is trying to get around the Supreme Court's decision through a technical legal change in the relationship between Kraft's parent company in Europe and itself. The only reason for this change - from an exclusive licence to an outright sale of the Canadian rights in the logo - was to sue Euro-Excellence. What is particularly offensive is that the Federal Court of Appeal indicated only a few years ago that this sort of manoeuvre could well violate Canada's competition laws. When the only reason behind the transfer of copyright is to prevent competition from other importers, the transfer is suspect.

Nonetheless, Kraft did exactly this.

While Euro-Excellence could fight the case and, given the law, win, it is unfair to make this company pay all the expenses of a second long court battle to protect Canadian consumers. And make no mistake: It is Canadian consumers who lose when international companies such as Kraft prevent the importation of perfectly legitimate, fully paid products available on the international market. Free trade was designed to bring more competition and better value to consumers. Kraft's action seeks to prevent this.

If Kraft succeeds, customs officials will have to add chocolate bars to the list of items that cannot be brought into Canada. I must admit to a personal interest: Last month, I imported four Cote d'Or chocolate bars from France. If Kraft is right in its argument, then I have breached copyright law and customs officials should have seized them. Absurd.

While access to chocolate bars at reasonable prices may not be Canada's highest priority, the precedent Kraft is setting is deeply worrisome. Kraft and other international corporations are large and profitable because of the openness of world markets. It undermines public confidence in trade and in the fairness of the market when these same companies bully small competitors out of the market to maintain artificially high prices. The Competition Bureau needs to send a message to Kraft and other international companies contemplating similar anti-competitive practices that their conduct is not welcome here.

Wednesday, December 19, 2007

Kraft is suing Euro Excellence - again. Here's part of what Richard said:

Kraft is trying to get around the Supreme Court's decision through a technical legal change in the relationship between Kraft's parent company in Europe and itself. The only reason for this change - from an exclusive licence to an outright sale of the Canadian rights in the logo - was to sue Euro-Excellence. What is particularly offensive is that the Federal Court of Appeal indicated only a few years ago that this sort of manoeuvre could well violate Canada's competition laws. When the only reason behind the transfer of copyright is to preventcompetition from other importers, the transfer is suspect.

Nonetheless, Kraft did exactly this.

While Euro-Excellence could fight the case and, given the law, win, it is unfair to make this company pay all the expenses of a second long court battle to protect Canadian consumers. And make no mistake: It is Canadian consumers who lose when international companies such as Kraft prevent the importation of perfectly legitimate, fully paid products available on the international market. Free trade was designed to bring more competition and better value to consumers. Kraft's action seeks to prevent this.

(emphasis added)

Needless to say, I agree. I successfully made very similar arguments earlier this year in Kraft #1 at the Supreme Court. Kraft, apparently, is determined to attempt to use the Copyright Act to subvert free trade with a result that would resound throughout the Canadian economy and affect countless products to which the act was never meant to apply. Seven out of nine justices clearly had no sympathy for Kraft's position. But Kraft is oblivious.

When a company is as big and rich as Kraft, it seems that it can follow the old maxim: "if at first you don't succeed, try try again."

Let's see what the Courts have to say about this the second time around.

Such a commission could do a great job of inquiring into the Canadian copyright system, if given an adequate budget, staff and terms of reference to get the job done and to issue a fully reasoned and documented report in the tradition of Justices Parker, Ilsley, and the Economic Council. England also has this tradition, as Bill Patry recently pointed out , not to mention Judge Whitford's report.

Such a commission could solve a major problem for the Government by taking care of an apparently intractable structural problem that has eluded successive governments and ministers for years, which is how to handle the copyright file within the departmental framework. Such a commission could have credibility with all stakeholders, if done right.

Such commission should be led by a judge who knows a lot about intellectual property law and whose expertise, experience and, above all, independence are beyond question.

Friday, December 14, 2007

It’s no secret that, for a long time, it has not been the best of times at WIPO.

For whatever reason, WIPO has been singularly unsuccessful in the past decade at international norm setting. While it continues to take in enormous amounts of money from its patent and trade-mark operations, and has done a terrific job at domain name dispute arbitration, its treaty making role in substantive law has basically fizzled. The reasons are complex and the result is sad, because there are some really dedicated and highly professional people at WIPO and in various member states who have tried to get good things done.

WIPO’s last major treaty success, if it can be called that any more, was the 1996 WIPO WCT and WPPT internet treaties, which have had an embarrassingly slow uptake in terms of ratification. Amongst developed countries, only the USA, Japan and Australia (courtesy of now de-elected John Howard) have ratified. The EU, Israel, Ireland, Switzerland and Canada have signed but not ratified. (Belgium apparently ratified by mistake, contrary to EU procedures). The rest of the ratifiers are essentially a "coalition of the billing", ranging from Albania to Venezuela. China, in a class by itself, has recently acceded. (However, the US hardly views China as an example of wonderful IP practice, and has brought a sweeping complaint against it in the WTO).

The 1989 audiovisual film registration and “Washington” integrated circuit protection treaties fizzled and never came into force.

Patent law harmonization has fizzled.

Most notably , the long and painful attempt to develop an unnecessary broadcasters rights treaty appears to have finally gone into a permanent and irreversible coma, though it hasn’t yet been declared officially dead.

So, what could WIPO do now that might be useful and might actually have a successful outcome?

How about a treaty on the public domain?

The public domain is incredibly important. Even Canada’s Access Copyright professes to be interested in the “PD”, though its much touted project with Creative Commons seems to be nowhere in sight.

We could use a treaty about when and how works enter the public domain. I doubt that much can be done to undo the irreversible self-inflicted wound of life + 70 years concocted by the US and EU, and now inflicted bilaterally on many countries not sufficiently independent or well informed to resist the bilateral blandishments of the USA. Mexico has inexplicably gone to life + 100.

However, there is still a lot of room to deal with such issues as posthumous unpublished works, government works, works subject to conflict of laws, and maybe even works transmitted over the internet, etc. This is tremendously important. It is the sort of highly technical issue that WIPO once handled very well and in which the WTO lacks any expertise or experience. It’s in everyone interest to get this right - from reclusive scholars to corporate entertainment giants. And it could give WIPO an opportunity to get back into its groove.

Ivor Tossell of the Globe and Mail has a very provocative article today about how copyright is now “cool” and “sexy.” The irony is that the copyright maximalists are reaping what they have sown.

Indeed, there is a growing recognition that copyright is becoming an issue that also resonates with other familiar - and such politically sensitive - “sexy” issues as:

• Political sovereignty. Note that Canadians are leery of “made in the USA” policies. Whether Iraq or DMCA.• Cultural sovereignty. Note that Canadians actually like their independent Canadian creators, such as Avril Lavigne, Sarah McLachlan and Bare Naked Ladies and respect their independent views on balanced copyright, which is quite different than that of many others who profess to speak for the Canadian music industry.• Cultural diversity. Note that there’s a lot of legitimate material from around the world that is being blocked in Canada by regional coding due to DRM, which is all about price discrimination and denial of access.• Individual freedom. Note that Canadians want to be able to see, read, hear and communicate whatever they wish whenever and however they wish without having pay too many times or too much or being blocked outright.• Competitiveness and innovation. Note that serious documented Canadian slippage could be because we already pay more for per capita and have less access to copyrighted materials than our counterparts in the other major economies.• Privacy. Canadians are justifiably proud of our serious respect for privacy, which has thus far been successful in preventing lawsuits against children and dead grandmothers in this country. Excessive DRM protection and litigation against downloaders and file sharers will blow this privacy away.

All of this is nothing if not ironic. The content industries have succeeded in raising the profile of IP to the highest levels of government in the G8 countries and elsewhere.

Much of the reason for this IP high profile is based upon profoundly fallacious metaphors and “moral panic” arguments, as Bill Patry is so eloquent at exposing. i.e. if I steal your car, I am clearly harming you, but if I cut and paste from your scholarly article or even from your movie or song, and I credit you, I am likely also benefiting you. Many, including musicians, would say the same about downloading songs. However, the DMCA and the anti fair use/fair dealing approach knows no such subtlety.

"Intellectual property" is not the same as "property" in real estate or a car.

Did these lobbyists really think that nobody would notice this increased attention to IP in the days of Web 2.0?

Thursday, December 13, 2007

It started. It stopped. It almost happened. Twice in one week. The tabling that was supposed to take place on December 11, 2007 didn’t happen. It was supposed to happen again today, Thursday, December 13, 2007. It didn’t happen.

This is a bit ambiguous. It would have been better in some respects to see the bill in all its detail - and let the public have 6 - 8 weeks to analyse and debate it before the House resumes. Now, it’s back to the backrooms, where anything can happen. Hopefully for the better, possibly for the worse.

The better scenario is that the Bill will get much better in the interim, and deal with the right issues so that it can be improved even more in Committee. And/or that it be tabled as a “draft” bill, like I suggested yesterday. This might be something like the “exposure draft” mechanism that they have in Australia, as I understand it.

Let’s hope that the Ministers and the PMO get this right and do the right thing, whether for sound policy reasons for simply for purely political reasons. They would then garner a huge amount of respect from the thousands of wired and articulate people who are watching this drama unfold and who are not going to fade away and forget very easily.

Here is my suggestion.

The Government should rework the bill that it obviously had profound second thoughts about and come up with one that ensures that:

1. ISPs should face no liability for users’ activities if they to respond promptly to “notice and notice” demands. “Notice and takedown” is not appropriate in Canada.

2. DRM and TPM protection measures must be minimal at most and not circumvent user’s rights to do anything otherwise legal under the Copyright Act or interfere with users’ first sale and exhaustion rights and must be directed at specific behaviour and not multipurpose technology.

3. Users’ rights must be extended to include such fair dealing rights as parody, time shifting and format shifting. They should be inclusive and not exhaustive, i.e. with inclusion of inclusive language such as “such as”....Broadcasters should get their ephemeral rights. There’s no need and no basis for a special educational exception for the internet.

4. The private copying levy scheme should be repealed

5. Any “Making available” right must require proof of actual and prejudicial distribution.

6. Statutory minimum damages should be eliminated against: a. Any person (individual or corporate) and any third parties serving them when there is a bona fide belief that the activity is fair dealing b. Any person (individual or corporate) doing anything without any expectation of direct financial gain.

This government could earn immense respect from countless real Canadians and people who watch Canada around the world if it shows real leadership here.

Wednesday, December 12, 2007

Sam Trosow is a Professor at Western. He has quietly become quite well respected in his few years in Canada. He brings with him experience in American copyright law and library science. He’s on sabbatical and currently a scholar in residence at CAUT.

Now that the government understands how important this issue is to so many Canadians, they have an excellent opportunity to open up the process to broader public consultation. But according to a CTV Report , Minister Prentice said, “To be speculating on what the bill says, when no one has seen it, is not really a constructive exercise.”

So I would ask the Minister, just how can the public engage the government on the issue in a "constructive" manner? Perhaps it is time for the government to release their latest draft version of the bill so we can all be on an even playing field in discussing it.

I don't know if the following is what Sam had in mind, but it could work this way. The Government would introduce its bill in as a “draft bill”, which means it can be referred to Committee for examination without the very rigorous rules of the usual legislative process, because it has not yet received “first reading.” The Committee could then hold hearings and then recommend changes, which the Government could take into consideration when it finalizes the actual Bill. For fans of arcane Parliamentary procedure (and you though copyright law was complicated?), see the “bible”, which is Marleau and Montpetit, p. 615.

This is worth thinking about. If Ministers Prentice and Verner and the PMO really want to hear what real Canadians need from a new copyright law, this could be a good way of getting that input. It could start with the Government's best shot as a "draft bill" when the House comes back after Christmas - and then get even better from there. An open, transparent and sincere set of hearings on a draft bill - without the constraints, pressures, secrecy and tension of the formal legislative process - might be just what is needed now.

Sunday, December 09, 2007

Michael Geist points to a very perceptive post by Ariel Katz who is at U of T about Israel's recent new copyright law.

According to Ariel:

Israel's new act has revealed its copyright priorities. Overall, Israel decided to increase the flexibility of its copyright law and make it more open and friendlier to users, educators and innovators. It decided to reduce the ways in which copyright law can work to restrict competition. For the time being, it decided not to enact anticircumvention rules that have the potential to work in the other direction. This choice is compatible with Israel's innovative and creative record. This choice is essential for a small economy whose citizens' brain is the only natural resource. Canada should seriously consider doing the same.

(emphasis added)

At the risk of being politically incorrect, let me point out something obvious here. If any country would seem to need to be beholden to the USA, it would probably be Israel. Yet Israel fiercely asserts its independence from the USA in many ways, and wariness of the DMCA approach is apparently one of them. Mazel Tov to Israel! Doubtless, this overall spirit of independence is one of the reasons why successive American administrations seriously respect Israel.

Canada is not nearly so dependent on the USA as Israel. Canada's very survival is not at stake. (Actually, it is in the long run as a result of the kind of pro-American pandering that we may soon see on this file, but not in the immediate day to day sense that Israel faces). However, Canada has forgotten that we won the war of 1812, which I was proudly taught way back when was the only war America has ever lost. That, of course, was well before Vietnam.

So - if Israel can call time out on the DMCA and assert copyright sovereignty, what is the matter with Canada?

The legendary “free software” ("free" refers to “liberty, not price”) proponent, Richard Stallman, has contacted me and expressed his appreciation of my post about how Canadian copyright law is already stronger and better in many ways than American law.

Monday, December 03, 2007

Deirdre McMurdy delightfully takes the copyright wars back to what some say is the beginning, i.e. the struggle between St. Finnian of Moville and St. Columba of Iona over St. Columba's copying of a psalter that belonged to St. Finnian. Hopefully, the forthcoming battle on Parliament Hill will be more restrained than the confrontation in 651 AD in in the battle of Cul Dreimhne, where there were some 2,000 casualties. Indeed, this epic is immortalized in a display in the WIPO building.

But Ms. McMurdy also provides a good update and checklist of what will start to play out any day now on the cold, snowy Parliament Hill. Complete with references to missionaries and their zeal.

For those who want to know more about Saints Finnian and Columba, see here:

St. Columba was born on December 7, ca. 521 A.D. to Fedhlimidh and Eithne of the Ui Neill clan in Gartan (Donegal). As a young man, Columba soon took an interest in the church, joined the monastery at Moville, and was ordained a deacon by St. Finnian. After studying with a bard called Gemman, Columba was ordained a priest by Etchen, the bishop of Clonfad. Columba entered the monastery of Mobhi Clarainech, and when disease forced the disbanding of that monastery, Columba went north and founded the church of Derry. Tradition has it that after founding several other monasteries, Columba copied St. Finnian's psalter without the permission of Finnian, and thus devalued the book. When Finnian took the matter to High King Dermott for judgement, Dermott judged in favor of Finnian, stating "to every cow its calf; to every book its copy" (I am borrowing this quote from Cathach Books in Dublin). Columba refused to hand over the copy, and Dermott forced the issue militarily. Columba's family and clan defeated Dermott at the battle of Cooldrevny in 561. Tradition further holds that St. Molaisi of Devenish, Columba's spiritual father, ordered Columba to bring the same number of souls to Christ that he had caused to die as pennance. In 563, Columba landed on Iona with 12 disciples, and founded a new monastery. After founding several more monasteries, confounding the local druids, and participating in another battle (this time against St. Comgall over who owned the church of Colethem), Columba died on June 9, 597.

Source: Life of Saint Columba, Founder of Hy. Written by Adamnan, Ninth Abbot of that Monastery, ed. William Reeves. (Edinburgh: Edmonston and Douglas, 1874) I

(emphasis added)

Note that this famous quote may help to explain why copyright is now such a "cash cow" for certain special interest groups. ;-)

More evidence of that the rumors of the death of DRM in the record business are not being excessively exaggerated can be found here at Reuters and here at Ars Technica.

So - one wonders whether the Canadian Government will really try to etch into stone a maximalist form of protection for a minimally useful and - more to the point - largely unworkable and dysfunctional technology that the industry itself is leaving behind as fast as it can. And as fast as one can spell C-R-I-A.

When automobiles came into being, the horse and buggy industry learned to adapt.

The rail industry adapted to airplanes.

IBM moved beyond typewriters and main frames - though their delay was extremely costly.

But the record industry remains stuck on a a one hundred year old model that maxed out in the 1980's with the $25 dollar CD.

Those days are over - and the Canadian government should let the fertile and creative part of the music industry and Canadian citizens, consumers and music fans move on.